Exhibit 10.1
RELOCATION AGREEMENT
THIS AGREEMENT is made as of June 5, 2001, by and between ADVANTA
CORP., a Delaware Corporation, ("Advanta") having an address at Welsh and XxXxxx
Xxxxx, Xxxxxx Xxxxx, XX 00000 and Xxxxxxx X. Xxxx, an individual, ("Xxxx")
having an address at 0000 Xxxx Xxx Xxxxx Xxxxxx, Xxxx Xxxx Xxxx, XX 00000.
THE BACKGROUND OF THIS AGREEMENT IS AS FOLLOWS:
A. Xxxx is President of Advanta Bank Corp., an affiliate of Advanta. In
connection with his presidency of Advanta Bank Corp., Advanta has asked
Xxxx to establish and maintain residency in Utah and has agreed to (i)
provide mortgage financing for the acquisition of his residence in
Utah, (ii) to pay Xxxx a relocation payment for certain expenses
related to his relocation to Utah and (iii) to provide a equity line of
credit to finance certain expenses relating to the establishment and
maintenance of his residence in Utah.
B. As of June 5, 2001, Xxxx is the owner of certain real property located
in Salt Lake County, Utah, and known as 0000 Xxxx Xxx Xxxxx Xxxxxx,
Xxxx Xxxx Xxxx, Xxxx (the "Property") which is more fully described in
Exhibit "A" attached hereto .
C. At closing Xxxx executed and delivered to Advanta, a Note dated June 5,
2001 in the original principal amount of Three Hundred Fifty Two
Thousand Eight Hundred Dollars ($352,800.00) (the "Purchase Money
Note") and a Deed of Trust dated June 5, 2001 ("Purchase Money Deed of
Trust") securing the Purchase Money Note and intended to be a first
lien against the Property. The Purchase Money Deed of Trust was
recorded in the official records of Salt Lake County, Utah as Entry No.
7697069 in Book 8465, at page 3390. A copy of the Purchase Money Note
and a copy of the Purchase Money Mortgage are attached hereto as
Exhibits "B" and Exhibit "C";
D. Advanta also agreed to pay Xxxx the sum of Forty Thousand Five Hundred
Eighty-one and 08/100 Dollars ($40,581.08), as a relocation payment
plus an additional sum equal to the amount of Jeff's income tax
liability for such relocation payment;
E. Advanta desires to provide to Xxxx an equity line of credit in an
amount not to exceed One Hundred Thousand Dollars ($100,000) for use by
Xxxx in establishing and maintaining the Property.
F. Xxxx has agreed to execute and deliver to Advanta a promissory note
(the "Revolving Note"), in the form attached hereto as Exhibit "D", to
evidence the equity line of credit;
G. Xxxx has agreed to execute and deliver to Advanta a deed of trust
securing the Revolving Note in the form attached hereto as Exhibit "E",
which is intended to be recorded as a second lien against the Property
(the "Revolving Deed of Trust"); and
H. Xxxx and Advanta desire to set forth their understanding with respect
to these loans and the repayment of the Purchase Money Note and the
Revolving Note.
NOW, THEREFORE, intending to be legally bound hereby, Xxxx and Advanta
agree as follows:
1. Purchase Money Obligation.
(a) The original principal amount of the Purchase Money
Note is $352,800.00. Pursuant to the Purchase Money
Note, interest will be charged on unpaid principal
until the full amount of principal and accrued
interest has been paid. Interest thereunder shall be
charged at an annual rate of seven percent (7%). The
maturity date of the Purchase Money Note is June 30,
2031.
(b) In the absence of a Repayment Event as described
below, repayment of all principal and interest due
under the Purchase Money Note is deferred for the
initial three (3) years of the term. Beginning on
July 1, 2004, Xxxx will pay principal and interest
under the Purchase Money Note by making payments
every month.. Xxxx will continue to make monthly
payments of principal and interest on the first day
of each month thereafter until he has paid all of the
principal and interest and any other charges that he
may owe under the Purchase Money Note. Monthly
payments will be applied to interest before
principal. If, on June 30, 2031 Xxxx still owes
amounts under the Purchase Money Note, he will pay
those amounts in full on that date, which is called
the "maturity date."
(c) Monthly payments under the Purchase Money Note will
be calculated as of July 1, 2004 by adding all
accrued and unpaid interest as of such date to the
then outstanding principal balance and amortizing
such amount, at the annual rate of seven percent
(7%), over the then remaining term of the Purchase
Money Note.
(d) The Purchase Money Deed of Trust refers to a Rider
described therein as "the Rider to Note." While there
is no Rider attached to the Purchase Money Note, this
Agreement is intended to act a Rider thereto and is
hereby incorporated into the terms of the Purchase
Money Note.
2. Revolving Note and Revolving Deed of Trust.
(a) Xxxx shall use the proceeds of the Revolving Note for
the costs associated with establishing his household
at the Property and maintaining the Property,
including, for example, purchases of furniture,
linens, dishes, appliances and the payment of repair
bills, condominium fees, taxes and utility bills, as
mutually agreed by Xxxx and Advanta from time to
time.
(b) Requests for advances under the Revolving Note may be
made by Xxxx from time to time. The procedure to be
followed for advances is as
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follows: Xxxx shall submit to Advanta (to the
attention of Xxxxx Xxxx) a Draw Request Form (in the
form attached hereto as Exhibit "F"), together with
copies of all receipts or other appropriate
documentation and, if not clear from the
documentation submitted, an explanation of the
expenses represented by the receipts or other
documents. Upon confirmation by Advanta that the
expenses submitted are agreed upon expenses under
this Agreement, a sum equal to the total of such
expenses shall be advanced to Xxxx and same shall be
deemed an advance under the Revolving Note. All
advances under the Revolving Note shall cease upon
the earlier of June 30, 2004 or another Repayment
Event as described below, except for advances for
"Carrying Costs" (as hereinafter defined).
(c) The original principal amount available to Xxxx under
the Revolving Note is One Hundred Thousand Dollars
($100,000). Under the Revolving Note, interest will
be charged on so much of the principal as has been
advanced from time to time until the full amount of
principal and accrued interest has been repaid.
Interest thereunder shall be charged at an annual
rate of seven percent (7%). The maturity date of the
Revolving Note is June 30, 2011.
(d) In the absence of a Repayment Event as described
below, repayment of all principal and interest due
under the Revolving Note is deferred for the initial
three (3) years of the term. Beginning on July 1,
2004, Xxxx will pay principal and interest under the
Revolving Note by making payments every month. Xxxx
will continue to make monthly payments of principal
and interest on the first day of each month
thereafter until he has paid all of the principal and
interest and any other charges that he may owe under
the Revolving Note. Monthly payments will be applied
to interest before principal. If on June 30, 2011
Xxxx still owes amounts under the Revolving Note, he
will pay those amounts in full on that date which is
called the "maturity date."
(e) Monthly payments under the Revolving Note will be
calculated as of July 1, 2004 by adding all accrued
and unpaid interest as of such date to the then
outstanding principal balance and amortizing such
amount at the annual rate of seven percent (7%) over
the then remaining term of the Revolving Note.
(f) The Revolving Deed of Trust is intended to be
recorded as a second lien against the Property as
security for the repayment of the Revolving Note.
3. Payments. Xxxx will make all payments under the Purchase Money
Note and the Revolving Note at Advanta Corp., Welsh & XxXxxx
Roads, X.X. Xxx 000, Xxxxxx Xxxxx, Xxxxxxxxxxxx 00000 or at a
different place if required by Advanta .
4. Repayment Events. In the event that any of the following
events occurs prior to the "maturity date" set forth in the
Purchase Money Note or the Revolving Note,
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the total outstanding principal and accrued interest and all
other sums secured by the Purchase Money Note and the
Revolving Note shall become immediately due and payable (each,
a "Repayment Event"):
(a) Xxxx ceases to be President of Advanta Bank Corp. for
any reason;
(b) Xxxx leaves or retires or otherwise ceases to be
employed by Advanta Bank Corp., Advanta or any other
Advanta affiliate;
(c) At settlement, if the Property is sold; or
(d) June 30th, 2004, unless such date is extended by
mutual agreement of Xxxx and Advanta.
5. Repayment of Debt Upon the Occurrence of a Repayment Event.
(a) Within thirty (30) days after the occurrence of any
Repayment Event , or at any other time as Xxxx and
Advanta shall mutually agree, Xxxx shall cause the
Property to be appraised (by an appraiser mutually
acceptable to Xxxx and Advanta) to determine its fair
market value (the "FMV"). If no other Repayment Event
has previously occurred, Xxxx shall cause the FMV to
be determined within sixty (60) days of June 30,
2004, but no later than June 1, 2004.
(b) Within fifteen (15) days after determination of the
FMV, Xxxx shall advise Advanta whether he has elected
to (i) retain the Property or (ii) sell the Property
(the "Election").
(i) If Xxxx elects to retain the Property,
he shall, within ninety (90) days after the Election,
repay to Advanta (x) all sums then due and payable
under the Purchase Money Note and the Revolving Note,
including all accrued and unpaid interest (such
amount being called the "Debt" for purposes of this
Paragraph 5), if the FMV is equal to or greater than
the Debt; or (y) an amount equal to the FMV, if the
FMV is less than the Debt. If the FMV is less than
the Debt, the payment of the FMV shall be deemed to
be payment in full of the Debt and Xxxx shall be
released from all further obligation under the
Purchase Money Note and the Revolving Note. In either
event, Advanta shall promptly satisfy of record the
Purchase Money Deed of Trust and the Revolving Deed
of Trust.
(ii) If Xxxx elects to sell the Property, he
shall, within six (6) months after the Election,
repay to Advanta (x) one hundred percent (100%) of
the Debt, if the net proceeds of such sale (the "Net
Proceeds") are equal to or greater than the Debt; or
(y) an amount equal to the Net Proceeds, if the Net
Proceeds are less than the Debt. If the Net Proceeds
are less than the Debt, the payment of the Net
Proceeds shall be deemed to be payment in full of the
Debt and Xxxx shall be released from all further
obligation under the Purchase Money Note and the
Revolving Note. In
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either event, Advanta shall promptly satisfy of
record the Purchase Money Deed of Trust and the
Revolving Deed of Trust. For purposes of this
Paragraph 5, the term "Net Proceeds" shall mean the
proceeds of any sale of the Property less the costs
of sale, including customary brokerage commissions
and closing costs.
(c) If Xxxx elects to retain the Property, but has not
repaid the Debt within the time period described in
subparagraph 5(b)(i) above, then such failure to
repay the Debt shall be deemed to be a default under
this Agreement and the Purchase Money Note and the
Revolving Note and Advanta shall be entitled to
exercise all of its rights and remedies hereunder and
thereunder, including, but not limited to,
instituting a foreclosure action under the Purchase
Money Deed of Trust and the Revolving Deed of Trust.
If Xxxx elects to sell the Property, but, despite his
reasonable efforts, is unable to do so within the
time periods set forth in subparagraph 5(b)(ii)
above, then such failure to sell the Property and to
tender payment of the Net Proceeds to Advanta to
repay the Debt as set forth above shall be deemed to
be a default under this Agreement and the Purchase
Money Note and the Revolving Note and Advanta shall
be entitled to exercise all of its rights and
remedies hereunder and thereunder as aforesaid.
However, Xxxx xxx cure any such default by tendering
to Advanta a deed in lieu of foreclosure for the
Property, whereupon Xxxx shall have no further
obligation under the Purchase Money Note or the
Revolving Note.
(d) After any Repayment Event has occurred, and provided
there has occurred no default hereunder or under the
Purchase Money Note, the Purchase Money Deed of
Trust, the Revolving Note or the Revolving Deed of
Trust, Xxxx xxx continue to make draws under the
Revolving Note for the reasonable costs of
maintaining the Property, including, but not limited
to, condominium fees, taxes, utilities and any
necessary repairs (collectively, "Carrying Costs"),
but may not make draws under the Revolving Note for
any other costs associated with the Property, such as
acquisition of furniture or extraordinary
improvements to the Property.
6. Effective Date. This Agreement is effective as of June 5,
2001.
7. Notices. All notices required or permitted to be given by
either Xxxx or Advanta shall be given in writing in the manner
set forth for the giving of notices in the Purchase Money
Note.
8 Captions. The headings and captions used in this Agreement are
for convenience of reference only and shall not be construed
to affect in any way the interpretation of this Agreement.
9. Successors and Assigns. Subject to the limitations in this
Agreement with respect to the rights of third parties, this
Agreement shall be binding upon the parties and upon their
respective heirs, executors, administrators, successors and
assigns, and shall inure to
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the benefit of the successors and assigns of Advanta;
provided, Xxxx shall not voluntarily, involuntarily, or by
operation of law assign or transfer any right to receive
proceeds of the Purchase Money Note or Revolving Note or any
other interest which it may have under this Agreement, nor
convey the Property or any part thereof, without the prior
written consent of Advanta, which consent may be withheld in
the sole discretion of Advanta.
10. Amendment; Conflicts. This Agreement cannot be changed or
amended except by agreement in writing signed by the party
against whom enforcement of the change or amendment is sought.
In the event of any conflict between the terms of this
Agreement and any of the Loan Documents, the terms of this
Agreement shall prevail.
11. Governing Law. The provisions of this Agreement shall be
construed in accordance with the laws of the Commonwealth of
Pennsylvania, without regard to its conflicts-of-laws
principles.
12. Execution in Counterparts. This Agreement may be executed in
any number of counterparts, which together will be deemed to
constitute one and the same instrument.
The parties hereto have duly executed this Agreement, as a
sealed instrument, as of the day and year first above written.
ADVANTA CORP.
By: Xxxxxxxxx X. Xxx (SEAL)
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Name: Xxxxxxxxx X. Xxx
Title: Senior Vice President and General Counsel
XXXXXXX X. XXXX (SEAL)
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XXXXXXX X. XXXX
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